I know what you’re looking for here. I’ve told you that cannabis stocks are hot, but how do you find the best marijuana penny stocks? First, focus on day trading. Penny pot stocks don’t hold their value over days, months, and years. Get in and get out with your profits. Second, check out this strategy I’ve created to help find the best marijuana stocks…
1. Decide Which Marijuana Penny Stocks to Grab Right Now
Unfortunately, I can’t tell you which marijuana penny stocks you should buy now. That’s your job. However, I can tell you what to look for.
Concentrate on volatility. If there’s no price action, there’s no profit potential. You want a spiky chart that shows predictable patterns between support and resistance.
You also want to look for high-volume penny pot stocks. If there are only 1,000 shares in play, there’s no reason to dive in. You might not be able to sell quickly, which means you can’t control your losses.
2. Use Technical Analysis and Chart Patterns to Find the Best Opportunities
Any stock trade you make should be based on careful research. Otherwise, you’re putting your cash at risk. If you learn one thing from me, learn this: It’s all in the charts. Any trade you make should be based off a high opportunity chart pattern, even if the stock has amazing fundamentals.
Now, if you know anything about penny stock technical analysis, you’ll know that there’s a million chart pattern and indicators, but trust me, forget 99% of them and just use simple, clean chart patterns. With charts, simple is beautiful. You have a lot fewer headaches and have much greater odds of success.
But don’t overthink the charts! Look for clean price action. It could mean a hot ticker is making clean, higher highs and higher lows every few days, or it could be a stock with a recent exciting news story that’s just broken above its all-time high.
3. Fundamental Analysis for Penny Pot Stocks
As with all penny stocks, marijuana stocks generally don’t have the strongest fundamentals. They often have tiny operations, led by managers without the greatest reputations, and let’s be honest, most will blow up in the end.
You have to remember that penny stock movements are all about hype in general. Be on the right side of hype (whether bullish or bearish), and it should be an easy ride to profits. Make sure to keep up to date with news and company announcements regarding earnings, contracts, financing and regulatory issues.
Be thorough in this and research everything you can, there’s a lot of information out there, but know this: The more you research, the greater your odds of success.
4. Trade Hot Stocks and Be Ready to Grab Your Profits
There’s no use buying or shorting a stock that has exciting fundamentals when nobody gives a damn about the company and the stock price isn’t going anywhere. If nobody notices the stock, you can’t profit from it.
Make sure to only be in stocks that are hot: people are talking about them; they’re in the news; the charts look clean and ready for big moves. When you’re finally in a hot stock and you’ve made some healthy profits, don’t wait around too long. I can tell you from experience: It’s much better to be too early getting off the train than too late.
With pot stocks being one of the hottest sectors in 2019 and a bunch of these names being parabolic, you have to be aware that these crazy moves often end in major declines when the party’s over…So, be nimble, ready to close your position, and walk away from a stock — remember that hype doesn’t last forever but strong fundamentals can.
5. Create a List of the Best Penny Stocks
Your penny stocks watchlist is a handy tool. Keep five or six stocks on your watchlist at all times so you can take immediate advantage of a potential win. I also recommend maintaining a trading journal. Document failures and successes so you can avoid making the same mistakes twice.
